24Decision-making biases can be systematic features of normal behaviour, or deficits underlying 25 neuropsychiatric symptoms. We used behavioural psychophysics, spiking-circuit modelling and 26 pharmacological manipulations to explore decision-making biases in health and disease. Monkeys 27 performed an evidence integration task in which they showed a pro-variance bias (PVB): a preference 28to choose options with more variable evidence. The PVB was also present in a spiking circuit model, 29revealing a neural mechanism for this behaviour. Because NMDA receptor (NMDA-R) hypofunction is 30 a leading hypothesis for neuropathology in schizophrenia, we simulated behavioural effects of NMDA-31 R hypofunction onto either excitatory or inhibitory neurons in the model. These were tested 32 experimentally using the NMDA-R antagonist ketamine, yielding changes in decision-making 33 consistent with lowered cortical excitation/inhibition balance from NMDA-R hypofunction onto 34 excitatory neurons. These results provide a circuit-level mechanism that bridges across explanatory 35 scales, from the synaptic to the behavioural, in neuropsychiatric disorders where decision-making 36 biases are prominent. 37Significance 38 39People can make apparently irrational decisions because of underlying features in their decision 40 circuitry. Deficits in the same neural circuits may also underlie debilitating cognitive symptoms of 41 neuropsychiatric patients. Here, we reveal a neural circuit mechanism explaining an irrationality 42 frequently observed in healthy humans making binary choices -the pro-variance bias. Our circuit 43 model could be perturbed by introducing deficits in either excitatory or inhibitory neuron function. 44These two perturbations made specific, dissociable predictions for the types of irrational decision-45 making behaviour produced. We used the NMDA-R antagonist ketamine, an experimental model for 46 schizophrenia, to test if these predictions were relevant to neuropsychiatric pathophysiology. The 47 results were consistent with impaired excitatory neuron function, providing important new insights into 48 the pathophysiology of schizophrenia. 49 50 51 52 53 54 55 56 57 58 59 60